Blackstone Real Estate Partners VII told investors in a
letter yesterday that it closed on the first round of the fund’s
commitments, according to a person with direct knowledge of the
letter who asked not to be named because the communication was
private. The New York-based firm said last month it’s aiming to
raise about $10 billion for the pool.

Peter Rose, a spokesman for Blackstone, declined to comment
on the fund.

Real-estate investments have helped propel assets under
management at New York-based Blackstone to $159 billion, and its
$9.4 billion deal for the U.S. malls of Australia’s Centro
Property is the firm’s biggest transaction since the leveraged
buyout boom collapsed in 2007. Managers such as Fortress
Investment Group LLC, Colony Capital LLC and Starwood Capital
LLC also are pitching new property funds.

Blackstone Chairman Stephen Schwarzman told investors on a
conference call in July that the firm had invested or committed
$4.4 billion to real estate deals during the first six months,
exploiting relatively low prices and a sluggish global economy.

“Our primary focus remains on bankruptcies,
recapitalizations and debt acquisitions,” Schwarzman said on
the call. “There still remains significant distress in the
system and therefore plenty of opportunities for new
investments.”